A family bank can be just the thing to ensure that a family's interests are protected and that the entire clan lives up to certain standards.

In the late-18th and 19th Centuries, Mayer Amschel Rothschild established five family banks, in Frankfurt, London, Paris, Vienna, and Naples, and assigned one to each of his five sons. His action secured the assets of Europe's wealthiest family and preserved his descendants' control of their wealth and affairs for generations. It gave the sons the tools to do business on their own and to cooperate with one another.

In the present-day U.S., as in 19th-century Europe, a family bank can preserve wealth, provide family...